A few small adjustments to file dialogs:

a) Added Backspace key support for Tree-based file dialog.
b) Fixed issue inability to select a folder in project manager (always previous folder was selected instead).
c) Open Directory mode: changed "Open" to "Select Current Folder"
d) Block "Open" button when inappropriate content is selected (for example, file when in open folder mode, or folder when in open files mode)

editor/editor_file_dialog.cpp

@@ -197,6 +197,9 @@ Vector<String> EditorFileDialog::get_selected_files() const {
 void EditorFileDialog::update_dir() {
 
 	dir->set_text(dir_access->get_current_dir());
+
+	// Disable "Open" button only when we in selecting file(s) mode or open dir mode.
+	get_ok()->set_disabled(_is_open_should_be_disabled());
 }
 
 void EditorFileDialog::_dir_entered(String p_dir) {
@@ -452,6 +455,28 @@ void EditorFileDialog::_item_selected(int p_item) {
 		file->set_text(d["name"]);
 		_request_single_thumbnail(get_current_dir().plus_file(get_current_file()));
 	}
+
+	get_ok()->set_disabled(_is_open_should_be_disabled());
+}
+
+void EditorFileDialog::_items_clear_selection() {
+
+	item_list->unselect_all();
+
+	// If nothing is selected, then block Open button.
+	switch (mode) {
+
+		case MODE_OPEN_FILE:
+		case MODE_OPEN_FILES:
+			get_ok()->set_text(TTR("Open"));
+			get_ok()->set_disabled(item_list->is_anything_selected() == false);
+			break;
+
+		case MODE_OPEN_DIR:
+			get_ok()->set_disabled(false);
+			get_ok()->set_text(TTR("Select Current Folder"));
+			break;
+	}
 }
 
 void EditorFileDialog::_push_history() {
@@ -487,6 +512,26 @@ void EditorFileDialog::_item_dc_selected(int p_item) {
 	}
 }
 
+bool EditorFileDialog::_is_open_should_be_disabled() {
+
+	if (mode == MODE_OPEN_ANY || mode == MODE_SAVE_FILE)
+		return false;
+
+	Vector<int> items = item_list->get_selected_items();
+	if (items.size() == 0)
+		return true;
+
+	for (int i = 0; i < items.size(); i++) {
+
+		Dictionary d = item_list->get_item_metadata(items.get(i));
+
+		if (((mode == MODE_OPEN_FILE || mode == MODE_OPEN_FILES) && d["dir"]) || (mode == MODE_OPEN_DIR && !d["dir"]))
+			return true;
+	}
+
+	return false;
+}
+
 void EditorFileDialog::update_file_list() {
 
 	int thumbnail_size = EditorSettings::get_singleton()->get("filesystem/file_dialog/thumbnail_size");
@@ -681,6 +726,7 @@ void EditorFileDialog::update_file_list() {
 	favorite->set_pressed(false);
 	fav_up->set_disabled(true);
 	fav_down->set_disabled(true);
+	get_ok()->set_disabled(_is_open_should_be_disabled());
 	for (int i = 0; i < favorites->get_item_count(); i++) {
 		if (favorites->get_item_metadata(i) == base_dir) {
 			favorites->select(i);
@@ -1139,6 +1185,7 @@ void EditorFileDialog::_bind_methods() {
 	ClassDB::bind_method(D_METHOD("_unhandled_input"), &EditorFileDialog::_unhandled_input);
 
 	ClassDB::bind_method(D_METHOD("_item_selected"), &EditorFileDialog::_item_selected);
+	ClassDB::bind_method(D_METHOD("_items_clear_selection"), &EditorFileDialog::_items_clear_selection);
 	ClassDB::bind_method(D_METHOD("_item_db_selected"), &EditorFileDialog::_item_dc_selected);
 	ClassDB::bind_method(D_METHOD("_dir_entered"), &EditorFileDialog::_dir_entered);
 	ClassDB::bind_method(D_METHOD("_file_entered"), &EditorFileDialog::_file_entered);
@@ -1415,6 +1462,7 @@ EditorFileDialog::EditorFileDialog() {
 	//cancel->connect("pressed", this,"_cancel_pressed");
 	item_list->connect("item_selected", this, "_item_selected", varray(), CONNECT_DEFERRED);
 	item_list->connect("item_activated", this, "_item_db_selected", varray());
+	item_list->connect("nothing_selected", this, "_items_clear_selection");
 	dir->connect("text_entered", this, "_dir_entered");
 	file->connect("text_entered", this, "_file_entered");
 	filter->connect("item_selected", this, "_filter_selected");

editor/editor_file_dialog.h

@@ -143,6 +143,7 @@ private:
 	void _recent_selected(int p_idx);
 
 	void _item_selected(int p_item);
+	void _items_clear_selection();
 	void _item_dc_selected(int p_item);
 
 	void _select_drive(int p_idx);
@@ -172,6 +173,8 @@ private:
 
 	void _unhandled_input(const Ref<InputEvent> &p_event);
 
+	bool _is_open_should_be_disabled();
+
 protected:
 	void _notification(int p_what);
 	static void _bind_methods();

scene/gui/file_dialog.cpp

@@ -85,6 +85,10 @@ void FileDialog::_unhandled_input(const Ref<InputEvent> &p_event) {
 
 					invalidate();
 				} break;
+				case KEY_BACKSPACE: {
+
+					_dir_entered("..");
+				} break;
 				default: { handled = false; }
 			}
 
@@ -189,7 +193,7 @@ void FileDialog::_action_pressed() {
 		TreeItem *item = tree->get_selected();
 		if (item) {
 			Dictionary d = item->get_metadata(0);
-			if (d["dir"]) {
+			if (d["dir"] && d["name"] != "..") {
 				path = path.plus_file(d["name"]);
 			}
 		}
@@ -272,6 +276,26 @@ void FileDialog::_cancel_pressed() {
 	hide();
 }
 
+bool FileDialog::_is_open_should_be_disabled() {
+
+	if (mode == MODE_OPEN_ANY || mode == MODE_SAVE_FILE)
+		return false;
+
+	TreeItem *ti = tree->get_selected();
+	// We have something that we can't select?
+	if (!ti)
+		return true;
+
+	Dictionary d = ti->get_metadata(0);
+
+	// Opening a file, but selected a folder? Forbidden.
+	if (((mode == MODE_OPEN_FILE || mode == MODE_OPEN_FILES) && d["dir"]) || // Flipped case, also forbidden.
+			(mode == MODE_OPEN_DIR && !d["dir"]))
+		return true;
+
+	return false;
+}
+
 void FileDialog::_tree_selected() {
 
 	TreeItem *ti = tree->get_selected();
@@ -283,6 +307,8 @@ void FileDialog::_tree_selected() {
 
 		file->set_text(d["name"]);
 	}
+
+	get_ok()->set_disabled(_is_open_should_be_disabled());
 }
 
 void FileDialog::_tree_dc_selected() {
@@ -563,7 +589,7 @@ void FileDialog::set_mode(Mode p_mode) {
 			makedir->hide();
 			break;
 		case MODE_OPEN_DIR:
-			get_ok()->set_text(RTR("Open"));
+			get_ok()->set_text(RTR("Select Current Folder"));
 			set_title(RTR("Open a Directory"));
 			makedir->show();
 			break;

scene/gui/file_dialog.h

@@ -33,7 +33,6 @@
 #include "box_container.h"
 #include "os/dir_access.h"
 #include "scene/gui/dialogs.h"
-#include "scene/gui/dialogs.h"
 #include "scene/gui/line_edit.h"
 #include "scene/gui/option_button.h"
 #include "scene/gui/tool_button.h"
@@ -117,6 +116,8 @@ private:
 
 	void _unhandled_input(const Ref<InputEvent> &p_event);
 
+	bool _is_open_should_be_disabled();
+
 	virtual void _post_popup();
 
 protected: